After the Disasters in Japan, a Stoic Response From Aflac

CHOFU, Japan — Although Aflac is an American insurance company, the bulk of its revenue comes from Japan. That may be why the company has tried to take a characteristically Japanese approach to responding to this country’s devastating natural disaster.

It began with the decorum that managers say hundreds of telephone agents here in this Tokyo suburb used when talking to customers on March 11, even from under their desks as the call center was shaking violently. With headsets still in place, they explained as coolly as possible that an earthquake was under way — something obvious to people in eastern Japan, but unknowable to others in western Japan.

“The operators were able to act professionally, given the situation,” Tomoyo Mikazuki, a call center manager, recently remembered.

Aflac Japan has also suspended television advertising featuring its mascot duck, and quickly took out newspaper ads offering messages of condolences. Customers affected by the natural disaster were automatically given a six-month grace period to pay the premiums on the supplemental health and life insurance policies in which the company specializes. Aflac Japan and many of its employees, meanwhile, have donated millions of dollars to relief efforts.

The steps taken by Aflac are comparable to what many other Japanese companies have done: falling in line with the national calls for self-restraint, humility and sacrifice, while gradually putting interrupted or suspended operations back in place.

Although Aflac’s corporate headquarters is in Columbus, Ga., about 70 percent of the company’s $20.7 billion in revenue last year came from Japan. And it leads its segment of the Japanese insurance market, with nearly 21 million policies, sold by more than 19,000 agencies that are supported by about 4,000 Aflac employees working from 82 Aflac-owned offices around Japan.

“A lot of customers don’t think of us as American,” said Charles D. Lake, chairman of Aflac Japan. “We’re here.”

Because Aflac is not a property insurer like Chartis, Tokio Marine or others still trying to gauge the size of claims from the quake, tsunami and nuclear disaster that the Japanese government will ultimately help cover, Aflac’s business has been only minimally affected by the calamity.

Fewer than 5 percent of Aflac’s policies are in the Fukushima, Miyagi and Iwate prefectures most affected by the disaster, and the company has not had to revise its earnings projections to account for expected claims. (One agent died, and another remains missing, of more than 300 Aflac agents in the coastal areas of the affected prefectures.)

Mainly, Aflac is similar to many types of big Japanese companies with a national retail reach, which are each gradually making their way back from the various disruptions, including rolling power blackouts, that have affected segments of their daily operations.

Things were far worse back on the afternoon of Friday, March 11, when the magnitude 9.0 earthquake caused the skyscraper in the Shinjuku district of Tokyo that houses the company’s corporate office to sway like a reed in the wind. Elevators were stopped, which meant long walks for employees to the street from their offices.

Photo

Telephone operators at a call center for Aflac Japan in Tokyo. About 70 percent of the company's $20.7 billion in revenue last year came from Japan, and it leads its segment of the market there.Credit
Shiho Fukada for The New York Times

Because the trains had stopped running, too, workers at headquarters had to make their way home that night by their own devices, including some who paid hundreds of dollars to buy new bicycles. The company’s contingency plan included a phone tree that assigned workers to call co-workers, but with cellphone service cut, the plan was scrapped.

Mr. Lake was 200 miles west, in Niigata, on a business trip, and unable to return to Tokyo for two days. So Tohru Tonoike, the president, and Hiroshi Yamauchi, senior vice president of corporate planning, spent the night in the Tokyo office.

They and other managers immediately started to confirm the whereabouts of the company’s employees and sales agents. They learned that only two of Aflac’s offices in Sendai — the biggest city in the quake zone — were damaged.

Back in Georgia, 13 time zones away, Aflac’s chief executive, Daniel P. Amos, was eager to visit Japan. But with so much in flux, he delayed his trip, eventually arriving on March 21 for two days of meetings with clients, partners and employees. Meanwhile, more than a dozen workers were sent to Osaka to prepare an operations center to be expanded if the number of blackouts increased in Tokyo, where 70 percent of the company’s employees commute by train.

Aflac’s call center in Kobe, with about 170 people, took additional calls. A new customer-service window was set up in the office in Sendai, so customers without access to phones or living in refugee centers could file claims in person.

But managers say operators at their call center here in Chofu had little trouble adjusting to the somber mood of some callers; after all, they receive condolence training and even under normal circumstances must regularly speak with grieving customers.

“Our operators are trained to be empathetic,” said Junichiro Horie, a manager in the call center in Chofu. Also: “a lot of them have been around since the Kobe earthquake, so they have experience.”

Alas, not everyone involved with Aflac has been as sensitive. Shortly after the earthquake and tsunami, Gilbert Gottfried, an American comedian who supplied the voice for the squawking duck character in the Aflac television commercials that run in the United States, posted jokes about the disaster on his personal Twitter feed. The episode was not widely reported in Japan. But the company, citing a morals clause in its contract, quickly dismissed Mr. Gottfried, who subsequently issued a public apology.

As Aflac’s business gradually returns to near normal, the company has welcomed more than 160 new hires — including a dozen from the affected prefectures. The emergency videoconference calls to Georgia, so frequent a month ago, are now just ad hoc events.

The workers who went to Osaka have since returned to Tokyo. The broken stone tiles in the lobby of Aflac’s offices in Chofu have been cleared. Calls from sales agents and customers have almost returned to levels seen before the earthquake.

It is almost, in other words, as if Aflac really were a Japanese company.

Business management experts say that image could be important over the long haul. They note that many foreign-owned companies, particularly those from Europe, heeded pressure from their head offices and embassies to evacuate Tokyo or even leave Japan altogether in the days after the earthquake, particularly when the Fukushima Daiichi nuclear plant’s problems were just becoming evident.

Companies in some industries like banking had more flexibility to let workers leave the country, because they could work from offices in Hong Kong or Singapore. Companies with a big direct consumer presence, like Aflac, did not have that option.

“There is a risk for those companies that made a big separation between the locals and foreigners,” said Jesper Edman, who teaches in the M.B.A. program at Hitotsubashi ICS, a university in Tokyo. “That’s always there, and for those that didn’t handle it right, it could be a problem.”

A version of this article appears in print on April 16, 2011, on page B4 of the New York edition with the headline: After the Disasters in Japan, A Stoic Response From Aflac. Order Reprints|Today's Paper|Subscribe